BofA fined $1.2 billion by US government for failing to police suspicious activity

On October 13, the U.S. government imposed a $1.21 billion fine on Bank of America for widespread failures to effectively police potential money laundering and illicit activity. This marks the third-largest fine in Treasury Department history and stems from the bank's failure to report over $5 billion in suspicious activity, including $1 billion posing national security risks.

Treasury Secretary Scott Bessent emphasized that when a bank of this size neglects its anti-money laundering and sanctions obligations, it endangers the entire US financial system. Bank of America acknowledged its responsibility and stated that it has invested heavily in compliance technology and personnel. However, the bank's third-quarter results will include a $1.2 billion non-deductible charge, reducing quarterly net income by about 17 cents per share.

This fine, coupled with a $750 million civil penalty from the Office of the Comptroller of the Currency, highlights the bank's deficiencies in its anti-money laundering programs, as identified in a 2024 cease-and-desist order. The bank also paid an $11.6 million fine to the Office of Foreign Assets Control for over 400 violations of sanctions programs targeting countries like Russia and Iran.